HERMÈS - 2020 Universal registration document

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CORPORATE SOCIAL RESPONSIBILITY BUSINESS MODEL

A FRENCH MODEL OF CRAFTSMANSHIP

so as to perpetuate the values of excellence. Sustainable development is pursued in this spirit of sincerity, excellence and continuous improvement. It is built on accomplishments rather than abstract commitments, without fanfare but with the goal of long-term efficiency; acting with urgency while taking the time to do things well: our s craftspeople do not like to put off until tomorrow what they can accomplish today. Hermès’ craftspeople, and by extension the House, see time as an ally, that enables them to work well, to integrate the internal or external challenges of all stakeholders, in order to see things in a balanced perspective. In the making of an object by hand, it is impossible to skip a step to save time, everything flows in continuity, everything is necessary. These modes of operation shape and determine the way projects are conducted. They encourage the implementation of responsible policies and practices, using a participative approach, blending exacting requirements and efficiency to obtain a high-quality end result. While considering changing and accelerating contexts, projects take into account the necessary rhythm for sustainable change among employees, partners and natural ecosystems. Urgency to act and hasty execution should not be confused. The Hermès integrated model is distinguished by its different tangible and intangible heritages. Creative freedom, manufacturing expertise and retailing freedom are the operating modes. Their perpetual abundance, balancing preserved tradition and renewed modernity, is a source of continuous innovation and progress. There are four types of heritage: creative heritage: the artistic department invents new pieces, s objects and patterns, and revisits its timeless models, unfettered by limits or constraints. The quality of creation allows objects to retain their desirability; savoir-faire heritage: in addition to the emblematic saddle stitch, s Hermès’ craftspeople are masters of singular skills which are often unique and rare techniques. The preservation of knowledge, its transmission through apprenticeships and a proactive internal training policy play key roles. The care taken over in-house training ensures the article's durability. This savoir-faire also extends to creative designers, people working in retail and managers; materials heritage: only the most noble materials are used. They s bring the promise of long life to each object. Hermès monitors its supply chain very closely, chooses renewable materials carefully from responsible industries and manages their environmental impact, in particular on biodiversity; retail heritage: Hermès has developed an exclusive distribution s network, – both physical and digital – a reflection of the uniqueness of the House and its creativity. The stores are oases of exceptional customer experience, freely adapted to each local market. UNIQUE HERITAGES 2.1.1.2

2.1.1

ROOTS AND VALUES

2.1.1.1

Hermès has remained true to its values since 1837 and continues to thrive as a house where craftspeople are at the fore. By selecting the finest materials, it produces exceptional, useful and aesthetic objects, designed to last (thanks to their quality and desirability) and to be passed on. Hermès now has a world-wide reputation, but the House has always been, and remains, an independent company supported by family shareholders, the sign of stability and longevity. Promoting French manufacturing, its project is based on the excellence of the craftsmanship métiers ; human hands, savoir-faire and quality are the keys. The attention paid to people has a natural place at the heart of the House’s craftsmanship business model, both at its sites as well as its partners and suppliers. Hermès is attentive to working conditions, respecting a balance in terms of diversity and stringently applying the fundamental principles of the United Nations and OECD. The attributes of craftsmanship have shaped the development of the House since its founding and, at the same time, its relationship with the world. Naturally rooted in respect and humility, these attributes, over time, have become company values. The presence of these values permeates all employees, suppliers and partners. They form the platform for the House’s actions in matters of sustainable development by appropriating the notions of individual and group responsibility, authenticity in the search for excellence, or acceptance of the long-term approach as a factor influencing performance. Lived and embodied by the Senior Executives and all employees, today they are the lifeblood of its raison d’être 1. and represent the founding pillars of the Corporate Social Responsibility (CSR) approach that Hermès shares with its stakeholders: responsibility: a handmade leather object is the work of a single s person. Following the original principle “one person, one bag”, a single person masters all of the steps necessary for an object’s creation, and is accordingly responsible for its final quality. This sense of responsibility also covers the materials used, which must not only be the most beautiful but also of indisputable origin: they must be worthy of serving to create exceptional objects. This accountability also extends to the product’s future life: each craftspeople has a view that transcends beyond the production process. This heightened awareness of responsibility nourishes the individual and group sustainable development practices; authenticity: the craftspeople are passionate about emphasizing the s “authenticity” of beautiful materials and eschew the use of imperfect materials, even when the end result may seem acceptable. This demanding attitude is reflected in the attention paid to all the aspects that comprise the handmade object and its craftsmanship. The inside is afforded just as much care and attention as the outside. Hermès craftspeople, and all employees of the House, are nonetheless aware of their limits and imperfections, and constantly question each stage,

Sense of purpose 1.

52 2020 UNIVERSAL REGISTRATION DOCUMENT HERMÈS INTERNATIONAL